Misdeeds Pay Off, for Some : Courts: Defendants' settlements with cities include payments to nonprofit organizations.

SUSAN WOODWARDSPECIAL TO THE TIMES

Shinko, a Japanese maritime company, faced a misdemeanor charge in December for an oil spill in Los Angeles Harbor. In most cities, the company would have been fined by the courts--case closed.

But in Los Angeles, Shinko was not only fined $50,000, it gave an additional $50,000 to Heal the Bay, an environmental organization in Santa Monica that fights to stop ocean pollution.

Then there was the case of landlord Augusto J. David, who was prosecuted in 1993 for failing to repair his 16-unit building in Silver Lake. The courts fined him $5,000. He also agreed to write a $4,000 check to Harbor Interfaith, a homeless shelter in San Pedro.

Under pressure to pay back the community for their misdeeds, more and more defendants have been hammering out deals such as these with city attorneys.

The program, which began about the time James K. Hahn was elected city attorney nine years ago, has no name and is not established by law.

The settlements are not without controversy: Some defendants argue that they are being coerced into making stiff charitable payments, and lesser-known nonprofit organizations say they should also benefit from the deals.

But Hahn defends the efforts of city prosecutors to persuade defendants, especially wealthy corporations, to reimburse the community for illegal actions.

He estimates about $1 million has been injected into the community through various organizations since 1985. About $700,000 has come from slumlords.

Without such innovative agreements, "the fine would disappear into the general fund of the State of California and we don't know where that would end up," Hahn said. "If the defendant is willing to plead guilty to the crime, we offer this as our part of the settlement."

Most times, the deputy city attorneys who handle the cases suggest a community contribution. Sometimes a municipal judge takes the initiative.

But the motive is the same, explained Deputy City Atty. Vincent B. Sato.

Few offenders who negotiate a charitable contribution repeat their crimes, Sato said, so the settlements seem to be educational.

"We're not trying to hurt (defendants) in their pocketbooks," Sato said. "We're trying to send a message to their hearts and their brains about their responsibility in the community."

Only a small percentage of the 150,000 cases handled by the city attorney's office every year warrant such settlements, Hahn said. However, he said, such deals could spread to other types of legal cases.

Offenders are encouraged to pay money to organizations that are somehow related to their crimes.

One of the more unusual settlements involved the donation of toys by defendant Sumrey Aueyong, who was prosecuted for failing to repair his downtown toy store. The donation went to the nearby Las Familias del Pueblo child-care facility.

The biggest payout was made in 1991 when ICI Americas Inc. pleaded guilty to 10 counts of discharging pollutants into city sewers. The company paid $165,000 in charitable contributions to Heal the Bay and the Los Angeles Audubon Society.

The Santa Monica Mountains Conservancy has been a recipient on at least two occasions. Most recently it received $2,366 from an auto body shop that was convicted of dumping flammable hazardous waste.

City attorneys offer these incentives to defendants: The charitable contributions are a tax write-off and they also soften the impact of negative publicity.

For those nonprofit groups that would like to get in on the action, Hahn said: "We like to know that they have some sort of track record and are a legitimate organization."